Panama Official accuses Hong Kong Port Operator Misconduct
A senior Panamanian government official said on Monday that he had uncovered evidence that a Hong Kong-based company was guilty of misconduct. This finding could delay or even scuttle a deal between China and the United States that involved 43 ports, two of which were in Panama. China, which has tightened its control over Hong Kong since 2020, has strongly criticized the transaction. China, which has exercised tight control of Hong Kong since 2020, has strongly criticized the transaction.
In the latest twist, Panama’s controller general, an independent government official who audits public finances, said CK Hutchison had not properly renewed its contract to operate the ports in 2021 and owed the government $300 million in fees.
The controller, Anel Flores, said he would file a complaint with the prosecutor’s office and added that it was up to the government agency that awards port concessions to determine whether the contract with CK Hutchison was illegal.
Mr. Flores’s actions could delay the deal for the two ports significantly.
“The longer you drag this out, the greater the opportunity for China to meddle in the transaction,” said Benjamin Gedan, a Latin America expert who lectures at Johns Hopkins.
Panama’s government could ultimately decide to take the ports away from CK Hutchison, Mr. Gedan said, and invite bids for the rights to operate them.
BlackRock declined to comment on the controller’s actions. Larry Fink, BlackRock’s chief executive, answered the question at a meeting of the Economic Club of New York held on Monday. Mr. Fink said that the deal would be reviewed “as a single transaction” at this time. Trump praised the deal in March when he said to Congress that his administration was “reclaiming” the Panama Canal.
CK Hutchison acquired the port concessions back in 1997 and extended the contract for 25 years in 2021. Mr. Flores said that his office was led by someone else at the time and had not approved the contract renewal. Flores announced that he would be auditing the agreement between CK Hutchison and Flores as Mr. Trump assumed office. Panama’s government has responded to Mr. Trump’s assertions about the Panama Canal being owned by the United States, or controlled by China.
